UNITED STATES


SECURITIES AND EXCHANGE
COMMISSION


Washington, DC
20549




Form
10-Q


(MARK
      ONE)x
              QUARTERLY REPORT UNDER
      SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934For the quarterly
      period ended March 31, 2008ORo
              TRANSITION REPORT PURSUANT TO
      SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
  ACTFor the transition period from
       ______________ to
______________


Commission File Number:000-32829




ANGEL
ACQUISITION CORP.


(Exact
name of small business issuer in its charter)






Nevada
            06-1588136(State of
      incorporation)
            (IRS Employer ID
      Number)1802
      N. Carson Street, Suite 212-3018,Carson
      City, Nevada
            89701(Address
      of principal executive offices)
            (Zip
      Code)







(775)
887-0670


(Issuer's telephone
number)




(Former
name, if changed since last report)
   Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days.   Yes x   No o
  Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.
  Large
accelerated filer o                                                                                                                  Accelerated
filer o
  Non-accelerated
filer o                                                                                                                   Smaller
reporting company x
   Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).  Yes o   No x
  State the
number of shares outstanding of each of the issuer's classes of common equity,
as of the latest practicable date: As of April 19, 2008, the issuer had
1,439,201 shares of its common stock issued and outstanding.
  Transitional
Small Business Disclosure Format (check one):  Yes o    No
x




Table of Contents






Table ofContents








PagePART I  FINANCIAL
      INFORMATIONItem
      1
                Financial Statements
                3Item
      2
                Management’s Discussion and Analysis or Plan of
      Operation
                12Item
      3
                Quantitative and Qualitative Disclosures About Market
      Risk
                15PART II   OTHER
      INFORMATIONItem
      1
                Legal Proceedings
                16Item
      2
                Unregistered Sales of Equity Securities and Use of
      Proceeds
                16Item
      3
                Defaults Upon Senior Securities
                16Item
      4
                Submission of Matters to a Vote of Security
      Holders
                16Item
      5
                Other InformationItem
      6
                Exhibits
                17Signatures
                18








Table of Contents




PART
I - FINANCIAL INFORMATION
  Item 1.Financial Statements
  The
accompanying unaudited interim financial statements of Angel Acquisition Corp.
("Angel") have been prepared in accordance with accounting principles generally
accepted in the United States of America and the rules of the Securities and
Exchange Commission ("SEC"), and should be read in conjunction with the audited
financial statements and notes thereto contained in Angel’s Annual Report filed
with the SEC on Form 10-KSB. In the opinion of management, all adjustments,
consisting of normal recurring adjustments, necessary for a fair presentation of
financial position and the results of operations for the interim periods
presented have been reflected herein. The results of operations for interim
periods are not necessarily indicative of the results to be expected for the
full year. Notes to the financial statements which would substantially duplicate
the disclosure contained in the audited financial statements for 2006 as
reported in the 10-KSB have been omitted.






ANGEL
ACQUISITION CORP.
 CONSOLIDATED
BALANCE SHEET AS OF MARCH 31, 2008
 (UNAUDITED)




ASSETSCash
              
              $
              3,852Prepaids
      and other current assets
              
              
              829Total
      current assets
              
              
              4,681Property,
      plant and equipment, net ofaccumulated
      depreciation of $91,057
              
              
              3,088,733Other
      Assets
              
              
              306,717Goodwill
              
              
              377,248TOTAL
      ASSETS
              
              $
              3,769,379LIABILITIES
      AND STOCKHOLDERS' EQUITYAccounts
      Payable
              
              $
              55,629Accrued
      Expenses
              
              
              322,258Current
      portion of notes payable
              
              
              2,549,884Total
      current liabilities
              
              
              2,927,771Note
      payable, long term
              
              
              2,195,386Accrued
      Derivative Liability
              
              
              326,562TOTAL
      LIABILITIES
              
              
              5,449,719MINORITY
      INTEREST
              
              
              177,069STOCKHOLDERS'
      EQUITY:Series
      A preferred stock, $0.00001 par value, 10,000,000 sharesauthorized,
      9,000,000 shares issued or outstanding
              
              
              90Series
      B preferred stock, $0.00001 par value, 50,000,000 sharesauthorized,
      30,000,000 shares issued or outstanding
              
              
              300Series
      C preferred stock, $0.00001 par value, 30,000,000 sharesauthorized,
      No shares issued and outstanding
              
              
              -Common
      stock, $0.00001 par value, 25,000,000,000 sharesauthorized,
      1,439,201 shares issued;and
      outstanding
              
              
              14Shares
      not yet earned
              
              
              (227,000
              )Additional
      paid-in capital
              
              
              17,718,774Accumulated
      deficit
              
              
              (19,349,587
              )Total
      stockholders' equity
              
              
              (1,857,409
              )TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
              
              $
              3,769,379The
      accompanying notes are an integral part of these financial
      statements.
 
  3
 Table of Contents




ANGEL
ACQUISITION CORP.
 CONSOLIDATED
STATEMENTS OF OPERATIONS
 FOR
THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007
 (UNAUDITED)




Three
      Months Ended
              
              
              Three
      Months EndedMarch
      31, 2008
              
              
              March
      31, 2007Revenues
              
              $
              133,433
              
              
              $
              323,346Cost
      of goods sold
              
              
              34,737
              
              
              
              212,469Gross
      profit
              
              
              98,696
              
              
              
              110,877Operating
      expensesGeneral
      and administrative
              
              
              202,850
              
              
              
              162,854Facilities
      and rent
              
              
              6,801
              
              
              
              16,368Consulting,
      legal and professional
              
              
              245,751
              
              
              
              1,806,155Payroll
      and related costs
              
              
              18,020
              
              
              
              122,483Total
      operating expenses
              
              
              473,422
              
              
              
              2,107,880Loss
      from operations
              
              
              (374,726
              )
              
              
              (1,997,003
              )Interest
      expense
              
              
              (93,006
              )
              
              
              (98,783
              )Minority
      interest
              
              
              46,603
              
              
              
              25,494Other
              
              
              (6,529
              )
              
              
              5,775Derivitve
      liability
              
              
              271,578
              
              
              
              (26,000
              )Net
      loss
              
              $
              (156,080
              )
              
              $
              (2,102,067
              )Net
      loss per share of common stock- basic and diluted
              
              $
              (0.11
              )
              
              
              (2.06
              )Weighted
      average number of shares of common stock outstanding
              
              
              1,369,639
              
              
              
              1,021,302The
      accompanying notes are an integral part of these financial
      statements.
 
 4
 Table of Contents




ANGEL
ACQUISITION CORP.
 CONSOLIDATED
STATEMENTS OF CASH FLOWS
 FOR
THE THREE MONTHS ENDED MARCH 31, 2008 AND 2007
 (UNAUDITED)






Three
      Months Ended
              
              
              Three
      Months EndedMarch
      31, 2008
              
              
              March
      31, 2007Cash
      flows from operating activities:Net
      loss for the period
              
              $
              (156,080
              )
              
              $
              (2,102,067
              )Minority
      Interest in Net Loss
              
              
              35,538
              
              
              
              9,353Adjustments
      to reconcile net loss to net cash used by operating
      activities:Depreciation
              
              
              7,697
              
              
              
              8,165Common
      stock issued for services
              
              
              155,850
              
              
              
              1,709,600Changes
      in assets and liabilities:Prepaid
      Expenses
              
              
              207
              
              
              
              (1,000
              )Other
      assets
              
              
              (189,398
              )
              
              
              (3,303
              )Accounts
      payable and accrued liabilities
              
              
              147,904
              
              
              
              58,580Net
      cash used in operating activities
              
              
              1,718
              
              
              
              (320,672
              )Cash
      flows from investing activities:Purchase
      of property and equipment
              
              
              -
              
              
              
              (
      82,300
              )Sale
      of Property
              
              
              -
              
              
              
              115,000Net
      cash used in investing activities
              
              
              -
              
              
              
              32,700Cash
      flows from financing activities:Proceeds
      from notes payable/net ofrepayments
              
              
              -
              
              
              
              157,593Proceeds
      from subscribed stock
              
              
              24,920
              
              
              
              94,946Proceeds
      from sale of common stock
              
              
              141,361
              
              
              
              77
      000Changes
      in Derivative liability
              
              
              (
      271,578
              )
              
              
              26,000Shares
      not yet issued
              
              
              99,724
              
              
              
              9,000Shares
      issued for reduction of debt
              
              
              (
      9,585
              )
              
              
              (30,993
              )Net
      cash flow from financing activities
              
              
              (15,158
              )
              
              
              297,146Net
      Increase (decrease) in cash
              
              
              (13,440
              )
              
              
              10,044Cash
      at beginning of period
              
              
              17,292
              
              
              
              35,187Cash
      at end of period
              
              
              3,852
              
              
              
              44,361SUPPLEMENTAL
      CASH FLOW INFORMATION:Interest
      Paid
              
              $
              55,401
              
              
              $
              67,423SUPPLEMENTAL
      SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:Common
      stock issued to satisfy liabilities
              
              $
              9,585
              
              
              $
              30,993The
      accompanying notes are an integral part of these financial
      statements.
   5
 Table of Contents




ANGEL
ACQUISTION CORP.
 NOTES
TO UNAUDITED FINANCIAL STATEMENTS
 FOR
THE PERIOD ENDED March 31, 2008
  NOTE
A - ORGANIZATION AND DESCRIPTION OF BUSINESS
  Angel
Acquisition Corp. (formerly Palomar Enterprises, Inc.) was incorporated on March
10, 1999 in accordance with the laws of the State of Nevada.
  Effective
April 21, 2008 Palomar changed its name to Angel Acquisition Corp to properly
reflect the change in business direction.
  NOTE
B - PREPARATION OF FINANCIAL STATEMENTS
  The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
  Management
further acknowledges that it is solely responsible for adopting sound accounting
practices, establishing and maintaining a system of internal accounting control
and preventing and detecting fraud. The Company's system of internal accounting
control is designed to assure, among other items, that 1) recorded transactions
are valid; 2) valid
transactions are recorded; and 3) transactions are recorded in the proper period
in a timely manner to produce financial statements which present fairly the
financial condition, results of operations and cash flows of the Company for the
respective periods being presented The Company is in the real estate development
and mortgage business employing 13 real estate brokers.
  NOTE
C - GOING CONCERN UNCERTAINTY
  The
Company has been unable to generate sufficient operating revenues and has
incurred operating losses.
  The
Company is operating as a mortgage broker and real estate developer. However,
the Company is dependent upon the available cash on hand and either future sales
of securities or upon its current management and/or advances or loans from
controlling shareholders or corporate officers to provide sufficient working
capital.
  The
Company has now changed its direction and while continuing in the mortgage
business is now concentrating on taking private companies public.
  There is
no assurance that the Company will be able to obtain additional funding through
the sales of additional securities or, that such funding, if available, will be
obtained on terms favorable to or affordable by the Company. It is the intent of
management and controlling shareholders to provide sufficient working capital
necessary to support and preserve the integrity of the corporate
entity.
  However,
there is no legal obligation for either management and/or controlling
shareholders to provide such additional funding.
  The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern.
  The
financial statements do not include any adjustments that might result from this
uncertainty.
  6
 Table of Contents
 
 NOTE
D - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
  1.
Cash and cash equivalents
  The
Company considers all cash on hand and in banks, including accounts in book
overdraft positions, certificates of deposit and other highly- liquid
investments with maturities of three months or less, when purchased, to be cash
and cash equivalents.
  2.
Principles of consolidation/Basis of Presentation
  The
consolidated financial statements include the accounts of the Company and its
88.52 percent interest in Blackhawk. All significant inter- company accounts and
transactions have been eliminated.
  The
Blackhawk fund is publicly traded on the OTC B.B. (BHWK). The financials of
Angel are inclusive of all activity of The BlackHawk Fund, as well as Angel, on
a consolidated basis. This includes all revenue, expenses, losses and
operations.
  On
February 5, 2008 the Company effectuated a 300 to 1 reverse stock split-all
financial statements have been retroactively stated to record this reverse
split.
  3.
Research and development expenses
  Research
and development expenses are charged to operations as incurred. There were no
research and development costs incurred in the periods.
  4.
Advertising expenses
  Advertising
and marketing expenses are charged to operations as incurred. Advertising
expenses for the periods ending March 31, 2008 and 2007 was $ 28,249 and
12,344.
  5.
Revenue recognition
  The
Company generates revenue from the sale of real estate, brokerage commissions,
rental properties and mortgage loan originations. Revenues from real estate
sales and commissions are recognized on execution of the sales contract. The
Company records gross commissions on the sales of properties closed. The Company
pays the broker of record five percent of all transactions and 100 percent of
personal sales. This is in accordance with standard procedures. The Company
compensates its independent agents on a sliding scale between 70 and 80 percent
based on productivity. The Company also recognizes sales when it sells
properties that have been held for sale when their renovation is complete.
Revenue is recognized at "closing".
  The
Company also realizes revenue from its subsidiary, The Blackhawk Fund, from its
media production business for sale of media "spots" and
infomercials.
  7
 Table of Contents
  6.
Income Taxes
  The
Company utilizes the asset and liability method of accounting for income taxes.
Temporary differences represent differences in the recognition of assets and
liabilities for tax and financial reporting purposes, primarily accumulated
depreciation and amortization.
  As of
December 31, 2007, the deferred tax asset is related solely to the Company's net
operating loss carry forward and is fully reserved.
  7.
Earnings (loss) per share
  Basic
earnings (loss) per share are computed by dividing the net income (loss) by
the weighted-average number of shares of common stock and common stock
equivalents (primarily outstanding options and warrants). Common stock
equivalents represent the dilutive effect of the assumed exercise of the
outstanding stock options and warrants, using the treasury stock method. The
calculation of fully diluted earnings (loss) per share assumes the dilutive
effect of the exercise of outstanding options and warrants at either the
beginning of the respective period presented or the date of issuance, whichever
is later. As of March 31, 2008, the Company's outstanding warrants are
considered anti-dilutive.
 
 8.
Use of Estimates
  The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the accounting period. Actual results could differ from those
estimates.
  RECENT
ACCOUNTING PRONOUNCEMENTS
 
 In July
2006, the FASB issued Interpretation No. 48, "Accounting for Uncertainty in
Income Taxes" ("FIN 48"). FIN 48 clarifies the accounting for uncertainty in
income taxes recognized in an enterprises' financial statements in accordance
with SFAS No. 109, "Accounting for Income Taxes". FIN 48 prescribes a
recognition threshold and measurement attributable for the financial statement
recognition and measurement of a tax position taken or expected to be taken in a
tax return. FIN 48 also provides guidance on derecognizing, classification,
interest and penalties, accounting in interim periods, disclosures and
transitions. FIN 48 is effective for fiscal years beginning after December 15,
2006. The Company is  currently reviewing the effect, if any, FIN 48
will have on its financial position and operations.
 
 In
September 2006, the FASB issued SFAS No. 157, "Fair Value Measures" ("SFAS No.
157"). SFAS No157 defines fair value, establishes a framework for measuring fair
value in generally accepted accounting principles ("GAAP"), expands disclosures
about fair value measurements, and applies under other accounting pronouncements
that require or permit fair value measurements. SFAS No. 157 does not require
any new fair value measurements, however the FASB anticipates that for some
entities, the application of SFAS No. 157 will change current practice. SFAS No.
157 is effective for financial statements issued for fiscal years beginning
after November 15, 2007, which for the Company would be its fiscal year
beginning November 1, 2008. The implementation of SFAS No. 157 is not expected
to have a material impact on the Company's results of operations and financial
condition.
 
 In
September 2006, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 158, "Employers' Accounting for Defined Benefit Pension and Other
Postretirement Plans - an amendment of FASB Statements No. 87, 88, 106, and
132(R)". This statement requires employers to recognize the overfunded or
underfunded status of a defined benefit postretirement plan (other than a
multi-employer plan) as an asset or liability in its statement of financial
position and to recognize changes in that funded status in the year in which the
changes occur through comprehensive income of a business entity or changes in
unrestricted net assets of a not-for-profit organization. This statement also
requires an employer to measure the funded status of a plan as of the date of
its year-end statement of financial position, with limited exceptions. The
provisions of SFAS No. 158 are effective for employers with publicly traded
equity securities as of the end of the fiscal year ending after December 15,
2006. The adoption of this statement is not expected to have a material effect
on the Company's future reported financial position or results of
operations.
  8
 Table of Contents
 In
September 2006, the Securities and Exchange Commission ("SEC") issued Staff
Accounting Bulletin No. 108 (Topic 1N), "Quantifying Misstatements in Current
Year Financial Statements" ("SAB No. 108"). SAB No. 108 addresses how the effect
of prior year uncorrected misstatements should be considered when quantifying
misstatements in current year financial statements. SAB No. 108 requires SEC
registrants (i) to quantify misstatements using a combined approach which
considers both the balance sheet and income statement approaches; (ii) to
evaluate whether either approach results in quantifying an error that is
material in light of relevant quantitative and qualitative factors; and (iii) to
adjust their financial statements if the new combined approach results in a
conclusion that an error is material. SAB No. 108 addresses the mechanics of
correcting misstatements that include effects from prior years. It indicates
that the current year correction of a material error that includes prior year
effects may result in the need to correct prior year financial statements even
if the misstatement in the prior year or years is considered immaterial. Any
prior year financial statements found to be materially misstated in years
subsequent to the issuance of SAB No. 108 would be restated in accordance with
SFAS No. 154, "Accounting Changes and Error Corrections." Because the combined
approach represents a change in practice, the SEC staff will not require
registrants that followed an acceptable approach in the past to restate prior
years' historical financial statements. Rather, these registrants can report the
cumulative effect of adopting the new approach as an adjustment to the current
year's beginning balance of retained earnings. If the new approach is adopted in
a quarter other than the first quarter, financial statements for prior interim
periods within the year of adoption may need to be restated. SAB No. 108 is
effective for fiscal years ending after November 15, 2006, which for Company
would be its fiscal year beginning December 1, 2007. The implementation of SAB
No. 108 is not expected to have a material impact on the Company's results of
operations and financial condition.
  NOTE
E - FAIR VALUE OF FINANCIAL INSTRUMENTS
  The
carrying amount of cash, notes receivable, accounts payable, accrued liabilities
and notes payable, as applicable, approximates fair value due to the short-term
nature of these items. The fair value of the related party notes payable cannot
be determined because of the Company's affiliation with the parties with whom
the agreements exist. The use of different assumptions or methodologies may have
a material effect on the estimates of fair values.
 
 NOTE
F - RELATED PARTY TRANSACTIONS
  Company
pays consulting fees to the two officer's companies for management services. The
consulting fees totaled $69,000 for the period ended March 31,
2008.  The Company is also a 50% joint venture partner with one of its
shareholders in a property. All expenses are divided equally.
  The
Company advances funds periodically to its subsidiary. The total advanced to
date, which is eliminated in consolidation, is $$725,896.
  NOTE
G – PROPERTY
  Property
and equipment consisted of the following at March 31, 2008:
  Building
                
                $
                1,395,612Office
      equipment
                
                
                33,145Buildings
      held for sale
                
                
                1,774,900Total
                
                
                3,203,657Less:
      Accumulated depreciation
                
                
                (122,924
                )Property
      & equipment, net
                
                $
                3,080,733
 Assets
are being depreciated from five to forty years using the straight line
method.
  9
 Table of Contents
  NOTE
H - NOTES PAYABLE
  Notes
payable at March 31, 2008 are comprised of the following:
  Note
      payable to lending institution, original balance of $980,000interest at
      7.5% per annum.
                  Requires monthly principal and interest paymentsof 6,852 through
      2034.  Collateralized by building.
                
                $
                779,950Convertible
      debentures payable to an investor group, interest at 8% due no later than
      March 2009.
                
                $
                1,188,320Mortgage
      Payable secured by property Interest at 7.875% and 9.25% over prime
      interest only for the first ten years then amortized over 360
      months.
                
                
                1,440,000Mortgage
      Payable, secured by a building 7.875% Interest only for ten
      years
                
                
                496,000Credit
      line from a bank up to 500,000 interest only at one percent over
      prime.
                
                
                497,000Note
      Payable to a vendor in monthly installments Of $3,000
                
                
                19,000Convertible
      debenture, interest 8%, past due
                
                
                325,000Total
                
                $
                4,745,270Less
      current portion
                
                
                2,549,884Total
      long-term portion
                
                $
                2,195,386
   10
 Table of Contents
 NOTE
I - LEASES
  Our lease
at 120 Birmingham Dr. # 110-G Cardiff, CA. 92007 costs $975 per month. We are
also a party to a lease agreement with Ikon Financial Services. We lease a
copier from Ikon Financial Services for a price of $445 per month.
  NOTE
J - SIGNIFICANT EVENT
  In May
2007, the Company's attorneys, were in receipt of a notification from the SEC,
alleging a potential violation of The Company's employee stock incentive program
dating back to 2004. The Company denies any violations occurred. In February
2008 the company settled this litigation with no financial penalty
imposed.
  NOTE  K
- DERIVATIVE LIABILITY
 
 The
Company is accounting for the conversion option in the Convertible Note and the
conversion price in the Securities Purchase Agreement and the associated
warrants as derivative liabilities in accordance with SFAS 133, “Accounting for
Derivative Instruments and Hedging Activities” and EITF 00-19 “Accounting for
Derivative Financial Instruments Indexed to and Potentially Settled in a
Company’s Own Stock” due to the fact that the conversion feature and the
warrants both have a variable conversion price.
 
 The fair
value of the Convertible Note was determined utilizing the Black-Scholes stock
option valuation model.  The significant assumptions used in the
valuation are:  the exercise price as noted above; the stock price as
of March 31, 2008; expected volatility of 66%; risk free interest rate of
approximately 4.50%; and a term of one year.
 
 NOTE
L - COMMON STOCK TRANSACTIONS
 
 On
December 31, 2007 the Company had 261,748,758 shares issued. It then issued
3,747,142 shares to February 5, 2008 which then totaled 258,495,900 shares. On
February 6, 2008 the company effectuated a reverse stock split of 300 to 1 which
then resulted in 861,653 shares. The company then issued 565,000 shares for
services, and 12,548 shares for debt.
 
 
 11
 Table of Contents
 
 Item 2. Management'sDiscussion and Analysis or Plan of
Operations
  Forward-Looking
Information
  Much of
the discussion in this Item is "forward looking" as that term is used in Section
27A of the Securities Act and Section 21E of the Securities Exchange Act of
1934. Actual operations and results may materially differ from present plans and
projections due to changes in economic conditions, new business opportunities,
changed business conditions, and other developments. Other factors that could
cause results to differ materially are described in our filings with the
Securities and Exchange Commission.
  There are
several factors that could cause actual results or events to differ materially
from those anticipated, and include, but are not limited to general economic,
financial and business conditions, changes in and compliance with governmental
laws and regulations, including various state and federal environmental
regulations, our ability to obtain additional financing from outside investors
and/or bank and mezzanine lenders and our ability to generate sufficient
revenues to cover operating losses and position us to achieve positive cash
flow. Readers are cautioned not to place undue reliance on the forward- looking
statements contained herein, which speak only as of the date hereof. We believe
the information contained in this Form 10-QSB to be accurate as of the date
hereof. Changes may occur after that date. We will not update that information
except as required by law in the normal course of its public disclosure
practices. Additionally, the following discussion regarding our financial
condition and results of operations should be read in conjunction with the
financial statements and related notes contained in Item 1 of Part I of this
Form 10-QSB, as well as the financial statements in Item 7 of Part II of our
Form 10-KSB for the fiscal year ended, December 31, 2007.
  Management's
Plan of Operations
  Reverse
Stock Split
  Effective
February 4, 2008 we implemented a one for 300 reverse split of its issued and
outstanding shares of our common stock (the “Reverse
Split”).  Following the Reverse Split, the number of issued and
outstanding shares of our common stock was reduced to approximately 849,163 in
accordance with the one for 300 Reverse Split ratio.  The number
of our authorized common shares remained at 25,000,000,000, and the par value of
our common and preferred stock remained at $0.00001 per share following the
Reverse Split.  The authorized, issued and outstanding preferred
shares were not affected by the Reverse Split.  The authorized, issued
and outstanding shares of Class B Common Stock were not affected by the
Reverse Split
  Subsequent
Events
  Effective
April 21, 2008 we completed the steps necessary to change our corporate name
from “Palomar Enterprises, Inc.” to “Angel Acquisition Corp.” (“Name
Change”).  The Name Change was accomplished by filing an amendment to
the Registrant’s Articles of Incorporation with the Secretary of State of Nevada
effective on April 21, 2008.
  The name
change was approved by our Board of Directors and by a majority shareholder vote
without conducting a shareholders’ meeting as permitted by the Nevada
law.
 
 On April
24, 2008, we entered into a Stock Purchase Agreement with Terminus, Inc.
(“Terminus”) pursuant to which Terminus purchased 10,000,000 shares of Series C
Preferred Stock of The Blackhawk Fund, a Nevada corporation, from us for
$363,000.
  12
 Table of Contents
  Current
Business Plan
  Real
Estate Services
  We
currently provide brokerage services in the real estate market, as well as
purchase, renovate, develop and sell residential properties. We also through our
subsidiary produce infomercials and media stream advertising
  Future
Acquisition Strategy
  While we
will be continuing to pursue our real estate activities, we also plan to acquire
profitable businesses in a variety of sectors and industries, for the purpose of
developing and subsequently spinning off each successful venture to our
shareholders as a publicly traded company.  We plan to obtain a
majority interest in each business we will acquire, creating several
subsidiaries that consolidate financials on Angel’s balance sheet. Through these
acquisitions, Angel’s mission is to maximize shareholder wealth and to
experience aggressive growth with diversified holdings in several industry
sectors.  Angel’s management plans to investigate and analyze private
companies, operating with high profit margins or operating in markets with high
profit potential ,as possible candidates for an acquisition
proposal.
  Upon
acquisition of a new subsidiary, the new subsidiary can further its growth
through the financial and industrial guidance provided by Angel.  Angel
would be paid fees for administrative costs associated with the acquisition and
spin-off, as well as retaining an equity position in each company that is
spun-off.  Once the subsidiary is ready to enter the public marketplace,
Angel and its shareholders would receive a stock dividend in the newly formed
public company.  This process aims at providing shareholders of Angel with
diversified holdings in several public companies
  Future
Environment-Friendly Strategy
 We also
plan to diversify our business model and employ new strategies in the near
future, designed to further enhance shareholder value.  We plan to
become involved with projects which are ecologically sound, help reduce
America’s carbon footprint and other activities and projects geared toward the
“greening” of America.  We may become involved in distribution of
various environment-friendly products via the world wide web and are currently
developing a plan to support artists, musicians, cinematography and the arts who
promote and support renewable energy projects.  We plan to add to our
revenue stream by soliciting purchases of books and other downloadable products
from individuals and businesses on a periodic basis and using a portion of the
revenue received from such purchases toward our “greening” of America business
model.  The Company plans to use the funds from the sales of
downloaded materials to develop new ecologically-sound strategies and donate to
local charities and causes which support various renewable energy
projects.  The increased revenues will be used to develop the
Company’s business plans at the sole discretion of the Company’s board of
directors.
  Results
of Operations
  Continuing
operations
  Revenue
  Three
months ended March 31, 2008 compared to the three months ended March 31, 2007.
Total revenues were at $133,433 for the three months ended March 31, 2008
compared to $323,346 for the prior period, a decrease of59%  Sales
decrease is a result economic factors in the real estate industry as well as us
beginning to concentrate on our new business plan.
  Total
operating expenses for the three months ended March 31, 2008 compared to 2007
decreased  to $473,422 from $2,107,880 in the prior period.
This  decrease  was largely due less  stock for
services  and less expenditures company wide.
  Net loss
for the three months ended March 31, 2008 was $156,080 compared to a net loss of
$2,102,067 for the same period in 2007. Again, the decrease in loss attributable
to stock for services.
  13
 Table of Contents
 
 Liquidity
and Capital Resources
  As of
March 31, 2008, we had a deficiency in working capital of
$2,923,090.
  Critical
Accounting Policies
  The
preparation of our consolidated financial statements in conformity with
accounting principles generally accepted in the United States requires us to
make estimates and judgments that affect our reported assets, liabilities,
revenues, and expenses, and the disclosure of contingent assets and liabilities.
We base our estimates and judgments on historical experience and on various
other assumptions we believe to be reasonable under the circumstances. Future
events, however, may differ markedly from our current expectations and
assumptions. While there are a number of significant accounting policies
affecting our consolidated financial statements, we believe the following
critical accounting policy involve the most complex, difficult and subjective
estimates and judgments.
  Stock-Based
Compensation
  In
December 2002, the FASB issued SFAS No. 148 - Accounting for Stock-Based
Compensation - Transition and Disclosure. This statement amends SFAS No. 123-
Accounting for Stock-Based Compensation, providing alternative methods of
voluntarily transitioning to the fair market value based method of accounting
for stock based employee compensation. FAS 148 also requires disclosure of the
method used to account for stock-based employee compensation and the effect of
the method in both the annual and interim financial statements. The provisions
of this statement related to transition methods are effective for fiscal years
ending after December 15, 2002, while provisions related to disclosure
requirements are effective in financial reports for interim periods beginning
after December 31, 2002. We elected to continue to account for stock-based
compensation plans using the intrinsic value-based method of accounting
prescribed by APB No. 25, "Accounting for Stock Issued to Employees," and
related interpretations. Under the provisions of APB No. 25, compensation
expense is measured at the grant date for the difference between the fair value
of the stock and the exercise price.
  Recent
Accounting Pronouncements
 In July
2006, the FASB issued Interpretation No. 48, "Accounting for Uncertainty in
Income Taxes" ("FIN 48"). FIN 48 clarifies the accounting for uncertainty in
income taxes recognized in an enterprises' financial statements in accordance
with SFAS No. 109, "Accounting for Income Taxes". FIN 48 prescribes a
recognition threshold and measurement attributable for the financial statement
recognition and measurement of a tax position taken or expected to be taken in a
tax return. FIN 48 also provides guidance on derecognizing, classification,
interest and penalties, accounting in interim periods, disclosures and
transitions. FIN 48 is effective for fiscal years beginning after December 15,
2006. The Company is  currently reviewing the effect, if any, FIN 48
will have on its financial position and operations.
 
 In
September 2006, the FASB issued SFAS No. 157, "Fair Value Measures" ("SFAS No.
157"). SFAS No157 defines fair value, establishes a framework for measuring fair
value in generally accepted accounting principles ("GAAP"), expands disclosures
about fair value measurements, and applies under other accounting pronouncements
that require or permit fair value measurements. SFAS No. 157 does not require
any new fair value measurements, however the FASB anticipates that for some
entities, the application of SFAS No. 157 will change current practice. SFAS No.
157 is effective for financial statements issued for fiscal years beginning
after November 15, 2007, which for the Company would be its fiscal year
beginning November 1, 2008. The implementation of SFAS No. 157 is not expected
to have a material impact on the Company's results of operations and financial
condition.
  14
 Table of Contents
  In
September 2006, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 158, "Employers' Accounting for Defined Benefit Pension and Other
Postretirement Plans - an amendment of FASB Statements No. 87, 88, 106, and
132(R)". This statement requires employers to recognize the overfunded or
underfunded status of a defined benefit postretirement plan (other than a
multi-employer plan) as an asset or liability in its statement of financial
position and to recognize changes in that funded status in the year in which the
changes occur through comprehensive income of a business entity or changes in
unrestricted net assets of a not-for-profit organization. This statement also
requires an employer to measure the funded status of a plan as of the date of
its year-end statement of financial position, with limited exceptions. The
provisions of SFAS No. 158 are effective for employers with publicly traded
equity securities as of the end of the fiscal year ending after December 15,
2006. The adoption of this statement is not expected to have a material effect
on the Company's future reported financial position or results of
operations.
 
 In
September 2006, the Securities and Exchange Commission ("SEC") issued Staff
Accounting Bulletin No. 108 (Topic 1N), "Quantifying Misstatements in Current
Year Financial Statements" ("SAB No. 108"). SAB No. 108 addresses how the effect
of prior year uncorrected misstatements should be considered when quantifying
misstatements in current year financial statements. SAB No. 108 requires SEC
registrants (i) to quantify misstatements using a combined approach which
considers both the balance sheet and income statement approaches; (ii) to
evaluate whether either approach results in quantifying an error that is
material in light of relevant quantitative and qualitative factors; and (iii) to
adjust their financial statements if the new combined approach results in a
conclusion that an error is material. SAB No. 108 addresses the mechanics of
correcting misstatements that include effects from prior years. It indicates
that the current year correction of a material error that includes prior year
effects may result in the need to correct prior year financial statements even
if the misstatement in the prior year or years is considered immaterial. Any
prior year financial statements found to be materially misstated in years
subsequent to the issuance of SAB No. 108 would be restated in accordance with
SFAS No. 154, "Accounting Changes and Error Corrections." Because the combined
approach represents a change in practice, the SEC staff will not require
registrants that followed an acceptable approach in the past to restate prior
years' historical financial statements. Rather, these registrants can report the
cumulative effect of adopting the new approach as an adjustment to the current
year's beginning balance of retained earnings. If the new approach is adopted in
a quarter other than the first quarter, financial statements for prior interim
periods within the year of adoption may need to be restated. SAB No. 108 is
effective for fiscal years ending after November 15, 2006, which for Company
would be its fiscal year beginning December 1, 2007. The implementation of SAB
No. 108 is not expected to have a material impact on the Company's results of
operations and financial condition. .
  Off-Balance
Sheet Arrangements
  We do not
have any off-balance sheet arrangements.
  Item 3. Controlsand Procedures
  Disclosure
controls and procedures are controls and other procedures that are designed to
ensure that information required to be disclosed by us in the reports that we
file or submit under the Exchange Act is recorded, processed, summarized and
reported, within the time periods specified in the Securities and Exchange
Commission's rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information
required to be disclosed by us in the reports that we file under the Exchange
Act is accumulated and communicated to our management, including our principal
executive and financial officers, as appropriate to allow timely decisions
regarding required disclosure.
  Evaluation
of Disclosure and Controls and Procedures. As of the end of the period covered
by this Quarterly Report, we conducted an evaluation, under the supervision and
with the participation of our chief executive officer and chief financial
officer, of our disclosure controls and procedures (as defined in Rules
13a-15(e) of the Exchange Act). Based on this evaluation, our chief executive
officer and chief financial officer concluded that our disclosure controls and
procedures are effective to ensure that information required to be disclosed by
us in reports that we file or submit under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in
Securities and Exchange Commission rules and forms.
  Changes
in Internal Controls Over Financial Reporting. There was no change in our
internal controls, which are included within disclosure controls and procedures,
during our most recently completed fiscal quarter that has materially affected,
or is reasonably likely to materially affect, our internal
controls.
  15
 Table of Contents
  PART
II - OTHER INFORMATION
  Item 1. LegalProceedings
  In May
2007, the Company's attorneys, were in receipt of a notification from the SEC,
alleging a potential violation of The Company's employee stock incentive program
dating back to 2004. The Company denies any violations occurred. In February
2008 the company settled this litigation with no financial penalty
imposed
  Item 2. UnregisteredSales of Equity Securities and Use of
Proceeds
  None.
  Item 3. DefaultsUpon Senior Securities
  None.
  Item 4. Submissionof Matters to a Vote of Security
Holders
  Effective
February 4, 2008, the holders of the majority of the voting power of our
outstanding capital stock voted to approve a reverse split of our common stock
on the basis of one post-consolidation share for each 300 pre-consolidation
shares.  The majority stockholders acted by written consent without a
meeting.  The majority stockholders approved the reverse split by a
vote equivalent to a vote of 8,984,575,004 shares of common stock, which number
exceeded the majority of the issued and outstanding shares of our common stock
on the record date.
  An
information statement was filed by us with the SEC and furnished to each
stockholder of record in regards with this corporate action.
  Effective
April 21, 2008, the holders of the majority of the voting power of our
outstanding capital stock voted to approve a change in our corporate name to
“Angel Acquisition Corp.”  .  The majority stockholders
acted by written consent without a meeting.  The majority stockholders
approved the name change by a vote equivalent to a vote of 8,950,098,268 004
shares of common stock, which number exceeded the majority of the issued and
outstanding shares of our common stock on the record date.
  An
information statement was filed by us with the SEC and furnished to each
stockholder of record in regards with this corporate action.
 Item 5. Other Information
  None.
  16
 Table of Contents




Item 6.Exhibits
  Exhibit
      No.
                
                Identification
      of Exhibit3.1**
                
                Articles
      of Incorporation.3.2**
                
                Articles
      of Amendment to Articles of Incorporation.3.3**
                
                Articles
      of Amendment to Articles of Incorporation3.4**
                
                Certificate
      of Change.3.5**
                
                Certificate
      of Correction to the Certificate of Change.3.6**
                
                Certificate
      of Amendment to the Certificate of Designation for the Series B Preferred
      Stock.3.7**
                
                Certificate
      of Designation for the Series A Preferred Stock.3.8**
                
                Certificate
      of Designation for the Series C Preferred Stock.3.9**
                
                Articles
      of Amendment to Articles of Incorporation3.10
      **
                
                Articles
      of Amendment to Articles of Incorporation3.11**
                
                Bylaws.10.1**
                
                Steven
      Bonenberger Employment and Stock Purchase Agreement.10.2**
                
                Brent
      Fouch Employment and Stock Purchase Agreement.10.3**
                
                Joint
      Venture Agreement with Prize Pizza, LLC10.4**
                
                Joint
      Venture Agreement with K&S Family Entertainment.10.5**
                
                Purchase
      Agreement dated November 9, 2004, between Robert C. Simpson and Palomar
      Enterprises, Inc.10.6**
                
                Stock
      Purchase Agreement dated April 24, 2008 by and among Terminus, Inc., The
      Blackhawk Fund and Angel Acquisition Corp.14**
                
                Code
      of Ethics21**
                
                Subsidiaries31.1*
                
                Certification
      of Steven Bonenberger, President, Director and Chief Executive Officer of
      Palomar Enterprises, Inc., pursuant to 18 U.S.C. 1350, as adopted pursuant
      to 302 of the Sarbanes-Oxley Act of 2002.31.2*
                
                Certification
      of Brent Fouch, Treasurer, Chief Financial Officer and Director of Palomar
      Enterprises, Inc., pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to
      Sec. 302 of the Sarbanes-Oxley Act of 2002.32.1*
                
                Certification
      of Steven Bonenberger, President, Director and Chief Executive Officer of
      Palomar Enterprises, Inc., pursuant to 18 U.S.C. Sec. 1350, as adopted
      pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002.32.2*
                
                Certification
      of Brent Fouch, Treasurer, Chief Financial Officer and Director of Palomar
      Enterprises, Inc., pursuant to 18 U.S.C Sec. 1350, as adopted pursuant to
      Sec. 906 of the Sarbanes-Oxley Act of
2002.
  * Filed
herewith.   ** Previously Filed
  17
 Table of Contents




SIGNATURES
  In
accordance with the requirements of the Exchange Act, the Registrant caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
  Angel Acquisition
      Corp.Dated:
      May 19, 2008
                By:
                /s/ Steve
      BonenbergerSteve
      BonenbergerPresident,
      Chief Executive Officer and Director








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